Home values to drop significantly in some parts of B.C.; most assessments largely unchanged

Tracy Sherlock, Vancouver Sun01.04.2013

B.C. residential property assessments are down in several areas of Metro Vancouver affecting house prices throughout the region.Ric Ernst
/ PNG

Most homeowners in B.C. won't be seeing a huge jump in property value on their 2013 assessment. The assessments, just released today, are mostly stable, with some areas showing a drop of five per cent, or a rise of 10 per cent.Gerry Kahrmann
/ Vancouver Sun

Real estate market experts say they don't expect a big drop in Vancouver housing prices next year, despite the decline in average prices and number of homes sold in 2012.Arlen Redekop, PNG Files
/ Vancouver Sun

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This year, for the first time in many years, a number of homeowners in some areas of B.C. will see a drop in their property assessment, B.C. Assessment said Wednesday.

The most significant decreases will be seen in Whistler, Pemberton, on the Sunshine Coast and on Bowen Island, said Jason Grant, B.C. Assessment Authority assessor for the Vancouver Sea to Sky region.

“In stark contrast to last year, where (more than) 25-per-cent increases weren’t unusual, most residential homeowners (in Vancouver Sea to Sky) will open their assessment this year and say, ‘I’m within about five per cent … of where I was last year,’” said Grant McDonald, deputy assessor for B.C. Assessment’s Vancouver Sea to Sky region.

“Looking at the city of Vancouver, if you drew a graph for a 10-year period from 2002 to 2012, it pretty much is a very steep curve in terms of value increases, with a blip in 2008 when values appeared to be falling a bit. Now it has sort of flattened off; the market is taking a bit of a breather.”

Last year, homeowners in some areas of Vancouver, West Vancouver, Richmond and Burnaby saw their assessments rise as much as 30 per cent, while some areas, such as Squamish, Whistler and Pemberton saw decreases of 10 to 15 per cent.

“Some of the markets that saw some pretty good run ups in prices in 2011, saw a kind of floating back to earth in 2012,” said Cameron Muir, B.C. Real Estate Association chief economist. “For example, we’ve seen the single-family, detached-home market on the west side of Vancouver show more softness after a relatively strong 2011.”

Property assessments for a given year reflect market value as of July 1 the previous year. B.C. Assessment does not provide averages, but it did provide some specific “representative examples” of properties and how much their values changed this year.

A 50-foot, single family lot on Vancouver’s west side that was assessed at $1,645,400 in 2012 is assessed at $1,622,900 for 2013, a drop of 1.3 per cent. A single-family home on a 33-foot lot on the west side of Vancouver is assessed at $1,256,200, a drop of 5.8 per cent compared to a 2012 assessment of $1,329,600.

On the city’s east side, a 33-foot single-family lot assessed at $1,031,300 last year is assessed at $1,081,700 this year, an increase of 4.9 per cent.

In Whistler, a single-family dwelling in Alpine Meadows that was assessed at $2,252,000 last year is assessed at $2,145,000 this year, a drop of 4.8 per cent. In Whistler Village, a two-bedroom apartment that was assessed at $491,000 last year is assessed at $429,000 this year, a drop of 12.6 per cent.

The map below shows the overall change in property assessment values in each city over the past year. The darker the colour, the more that city’s overall assessment increased. Click on a city for more details.

4.95%+

3.55%-4.61%

3.04%-3.28%

0%-2.21%

Drop in value

On Bowen Island, a non-waterfront single-family home that was assessed at $530,000 last year was assessed at $454,000 this year, a drop of 14.3 per cent. A waterfront home there dropped to $1.3 million from $1.7 million, a drop of 23.5 per cent.

Muir said both of those areas are dependent on recreational buyers, and that the strong Canadian dollar and concerns about the U.S. and global economy are affecting that market.

“When we look at recreation properties, as well as luxury properties, (they) tend to be much more volatile in pricing,” Muir said. “When times are very good, prices tend to climb much more rapidly than your typical home. At the same time when we see some weakness, they’re likely to decline more rapidly as well.”

In other areas of Metro Vancouver, some properties saw increases up to 10 per cent, while some areas saw drops of up to five per cent from last year.

For example, a single-family house in the Thompson area of Richmond that saw a 30-per-cent increase last year to $1,677,000, is this year assessed at $1,642,000, a drop of two per cent.

Two years ago, Richmond saw some properties increase as much as 17 per cent, while many West Vancouver and Vancouver homeowners saw jumps in assessment of 12 or 13 per cent. Whistler prices were down two per cent at that time.

B.C. Assessment does provide percentage changes in the total value of properties in a region, but this amount is not an average change that homeowners will see on their assessments because it includes new construction and other non-market factors such as renovations and rezonings. Nonetheless, it is an indication of the general direction property assessments are moving in a given area.

Click on the map below to explore the priciest homes in Metro Vancouver and the Fraser Valley. The map shows the 100 most valuable residential properties according to BC Assessment in each of the Lower Mainland's four sub-regions: Vancouver-North Shore-Sea to Sky, North Fraser, South Fraser and Fraser Valley. Red dots are homes work more than $10 million, yellow dots those worth $4m-$10m, green dots those worth $2m-$4m and blue dots those worth less than $2m. Google Street View images are approximate and may not show the exact property in question.

Over $10m

$4m-10m

$2m-4m

under $2m

For 2013, the total property roll for Vancouver increased 2.08 per cent, in Delta it rose 3.55 per cent, in Surrey it rose 5.15 per cent and in West Vancouver it rose 8.8 per cent. The total property roll in Whistler fell 3.81 per cent, on Bowen Island it fell 6.9 per cent and in Pemberton it fell 4.31 per cent.

Across the province, the total number of properties on the 2013 roll is 1,935,426, a 0.92-per-cent increase from 2012. The total value of real estate on the 2013 roll is $1,129,026,081,413, a 2.3-per-cent increase from 2012, B.C. Assessment said.

A drop in a property’s value does not necessarily translate into a drop in property taxes, which would only differ from a city’s budgeted increase if a particular property has gone up or down in value more than the average for other properties in the same community.

Property assessments for 2013 reflect market value as of July 1, 2012. Since that time, sales in Metro Vancouver have slowed and some prices have dropped.

“In markets that have declined in value since the summer of 2012, the 2013 property assessment may be higher than current sales or listing prices,” said Zina Weston, deputy assessor.

“We’ve seen quite a decline in the number of sales; so far for 2012 it’s down about 30 per cent, but the actual values haven’t really come off. In Vancouver, things are still selling for higher than we had on the assessment roll last year,” McDonald said.

People who feel that their property assessment does not reflect the home’s property value as of July 1, 2012, should contact the B.C. Assessment office for their area. Appeals will be accepted until January 31.

“It is a quieter year and I suspect that will be reflected in the number of inquiries we get,” McDonald said. “It will be interesting to watch the next few months to see what happens.”

One assessed value that is contentious is that of the Horseshoe Bay ferry terminal; a recent decision by the Property Assessment Appeal Board slashed its value to just $20 from $47.7 million, meaning the District of West Vancouver will lose about $250,000 in property tax revenue. The District of West Vancouver plans to fight the assessment, which could have ramifications for other ferry terminals, in court.

The province increased the threshold for the Home Owners Grant for property taxes by $10,000 to $1.295 million to keep pace with rising property value assessments, Finance Minister Michael de Jong announced Wednesday.

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